CounterCurrent: Week of 11/17/2025
For many, nothing evokes the nostalgia of college days more than watching a team from their alma mater achieve victory on the field or on the court. No matter if your school was D1 or D3, there is a source of pride cheering your school on to victory. But behind the roar of the crowd, a more unsettling story is emerging. College athletic programs can quietly sink a university’s finances, costs that ultimately land on students’ backs. Worse yet, private equity and billionaire patrons are moving in—and their money often comes with expectations that reshape athletics and the institution itself.
As of 2022, college athletics earned approximately $13.6 billion in total revenue, generated from layers of entities that trickle down to the school and then to the athletes. Despite their popularity, most college sports programs lose money. Outside the Big Ten and a handful of powerhouse conferences, universities routinely fail to break even—surviving only through mandatory student fees or outside subsidies.
Worth noting is in 1972, Congress amended the Higher Education Act, prohibiting exclusion from educational programs based on sex—i.e., Title IX. While Title IX did not explicitly mention sports, the National Collegiate Athletic Association (NCAA) interpreted the law to mean that there cannot be economic justification for favoring teams that are profitable. This means that there must be equal scholarships available to women as there are to men, and that sports arenas for the different sexes must have the same quality. So, even if a team is not economically profitable, a college or university must fund it, and that funding has to come from somewhere—most of the time, it's taken from the school budget or from mandatory student fees imposed each year. Take, for instance this example from an article Larry Bernstein wrote for Minding the Campus,
The College of William and Mary does not have a lucrative football program and has less than 9,000 students. The mandatory fee is $2,177. The school contributes another $250 per FTE student as well. That comes to almost $10,000 per student over four years just for small-time intercollegiate sports. The average debt of a William and Mary graduate is $35,500, so just over a quarter of that is due to intercollegiate athletics.
Although colleges and universities are not supposed to favor economically profitable teams, prioritizing certain sports and teams over others seems to happen organically, in part due to the “name, image, and likeness” (NIL) phenomenon and the outside funding it brings to schools.
In 2021, the NCAA implemented the NIL, an interim policy that allowed student athletes to make money on their own personal brand from third parties. This is where private equity groups and wealthy individuals come in. Private funds began to pour in for student athletes, mainly to football and basketball programs. For example, mega donors like Cody Campbell, who made his fortune in oil, poured millions into Texas Tech University’s football program, the Texas Tech Red Raiders. Campbell specifically helped to fund the team’s $25 million payroll and the new 300,000 square foot training facility. However, now, Campbell and others have become aware of the problems created by free flowing donations. Smaller sports programs are struggling to find much needed sunlight and nourishment under the strangling canopy of better fed football and basketball programs.
Private capital may seem like a good idea, but colleges and universities could run into problems, at least that’s what NCAA President Charlie Baker said a few weeks ago when he cautioned schools to “Be really careful” about long-term private equity deals to keep sports programs afloat. An article in the Dallas Morning News runs through the potential pitfalls of such a situation,
The pressure to deliver annual returns will also lead to difficult trade-offs. Schools will face pressure to raise ticket prices, cut budgets for non-revenue sports or even eliminate Olympic programs that do not generate financial returns. Private credit replaces ownership dilution with debt. Borrowed money requires repayment, interest and restrictive covenants. For universities already struggling to cover rising obligations, this can quickly become a burden.
The Trump administration has even addressed some of these concerns in an Executive Order (EO) dated July 24 of this year, offering solutions like “any revenue-sharing permitted between universities and collegiate athletes should be designed and implemented in a manner that preserves or expands scholarships and collegiate athletic opportunities in women’s and non-revenue sports.”
As tuition climbs and student debt becomes a defining burden of young adulthood, colleges and universities continue pouring resources into athletic programs that often lose money and distort institutional priorities. The result is a system in which students subsidize sports rather than the other way around. If universities want to preserve both academic integrity and athletic opportunity, they must redesign the model from the ground up—either by disentangling sports from academics or by imposing guardrails on private money. What they cannot do is keep shifting the cost onto students and calling it school spirit.
Until next week.
CounterCurrent is the National Association of Scholars’ weekly newsletter, written by the NAS Staff. To subscribe, update your email preferences here.
Photo by Keith Johnston on Unsplash
